In this chart I'd like to point out the current trend in the Dollar index the Fed uses, which is the trade weighted dollar index. The DXY or USDOLLAR tickers everyone's using don't reflect the situation of emerging markets, since they have heavy Euro and Yen weights in their calculation.
The setup is a monthly uptrend lasting at least until June, and with potential for at the very least 19.85% upside.
It's possible that the Euro is topping and will become an ideal short, to rejoin this general trend, and I don't expect to see broad dollar bears for the time being.
Now, how will this sway the Fed's intentions, since they consider that a stronger dollar is hurting their inflation targets, and thus their plan of action?
This might be a catalyst for a stocks rally this year, but for now things remain volatile, so I'd advise caution.
Check my gold, eurusd and SPY charts for more information on my perspective on said instruments.
Feel free to stop by the Key Hidden Levels chatroom as well, there my mentor and others trained in this methodology share setups on a daily basis.
If interested in coaching or trade signals contact me privately please.
I run a trading chatroom where I share trading setups on a frequent basis, focusing on EURUSD, USDJPY, USDCAD, Gold, Silver, Oil, Stocks and Bitcoin.
Cheers,
Ivan Labrie.